Sohan Lal Commodity Management Pvt Ltd Vs State Of UP

GST - Petitioner inter alia seeks quashing the proceedings pursuant to the search and seizure operation carried out at the warehouse of the petitioner no. 1 at Chandausi and at Barabanki; release of documents, assets and other materials etc. - Advocate General cites the apex court decision in Kay Pan Fragrance Pvt. Ltd - 2019-TIOL-517-SC-GST and submits that the Central Goods and Services Tax Act, 2017 provides a complete procedure for release of such goods, as contained in Section 67 of the Act read with Rule 141 of the relevant Rules; that the petitioners should have approached the appropriate authority under Uttar Pradesh Goods and Services Tax Act, 2017 to ventilate their grievance - Petitioners further submit that "Mentha Oil" has been seized in the matter which is perishable in nature but the authority concerned has not yet exercised its power under Section 67 of the Act - Revenue counsel informed that "Mentha Oil" is not perishable in nature and it has not been included in the schedule contained in the Notification dated 13th June, 2018 issued by Government of India.

Held: Without expressing any opinion on the merits of the case, this writ petition is finally disposed of with a direction to the petitioners to make an appropriate application/representation before the authority concerned under the relevant provision of the Act, 2017 ventilating their grievances and if any such application/representation is filed, the authority concerned shall make all endeavour to consider and decide the same by a reasoned and speaking order, after affording opportunity of personal hearing to the petitioners, in accordance with law expeditiously, preferably within two weeks from the date of receipt of the said application: High Court [para 9]

- Petition disposed of: ALLAHABAD HIGH COURT

2020-TIOL-1008-HC-ALL-GST

Salasar Techno Engineering Ltd Vs State Of UP

GST - Petitioner has challenged the order passed by respondent no. 3 u/s 129(3) of the CGST Act - It is not disputed that the impugned order is appealable under Section 112 and is to be filed within 90 days from the date on which the order sought to be appealed is communicated to the person preferring the appeal; that instant petition has been filed bypassing the remedy of appeal under Section 112 of the Act on the ground that the appellate tribunal has not been constituted till date - Revenue counsel points out that having regard to the difficulty faced by the assessees in filing appeal on account of non-constitution of the Tribunal and its Benches in various States and Union Territories, Central government has issued Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019 notified in the Gazette of India dated 3rd December, 2019 stipulating that in such a situation, the three months' period shall be considered to be the date on which the President or the State President, as the case may be, of the Appellate Tribunal after its constitution under Section 109, enters office - Therefore, it is urged that in such circumstances, the petitioner can wait and avail the remedy of filing appeal as and when the Tribunal is constituted - It is also pointed out that since the seized goods have already been released, therefore, no prejudice is going to be caused to the petitioner at the present moment - Counsel for the petitioner fairly admits the above legal position and also the fact that the goods have already been released.

Held: Instant petition is, therefore, disposed of by providing that the petitioner can invoke the remedy of filing appeal before the Tribunal in terms of the provisions of the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019: High Court

- Petition disposed of: ALLAHABAD HIGH COURT

2020-TIOL-29-NAA-GST

Director General Of Anti-Profiteering Vs Vikas Parks Pvt Ltd

GST - Anti-Profiteering - Section 171 of the CGST Act, 2017 - Applicant alleges that the respondent had resorted to profiteering in respect of supply of construction services related to the purchase of flat in the respondent's project ‘Hero Homes', Gurugram - applicant has also alleged that the respondent had not passed on the benefit of Input Tax credit by way of commensurate reduction in the price of the apartment purchased by him - DGAP in its report stated that prior to implementation of GST w.e.f 01.07.2017, service tax on construction service was chargeable @4.50% (14/2015-ST) and after implementation of GST, GST on construction service was chargeable @18% (effective rate was 12% in view of 1/3rd abatement on value) vide 11/2017-CTR and the effective rate of construction service in respect of affordable and low-cost homes was @8% effective vide 1/2018-CTR - DGAP has, therefore, observed that in the case of construction service, the effective rate of tax @4.5% in pre-GST era was lower than the effective rate of tax @8% or @12% in post-GST era; that the price charged for the said residential flat was a new project developed and constructed by respondent after implementation of GST, hence the anti-profiteering provisions would not be applicable; that the first booking in the project was made on 22.12.2018 and there was no price history of the units sold in the pre-GST era which could be compared with the post-GST base price to determine whether there was any profiteering; that in the present case, the registration and approval of the project, building plan, the launching of the project, allotment of units, receipt of payments etc. had all taken place in the post-GST regime, therefore, there was no pre-GST tax rate or ITC structure which could be compared with the post-GST tax rate and ITC - DGAP has concluded that in view of its aforesaid findings, it appeared that s.171(1) of the CGST Act has not been contravened by the respondent in the present case - said report of DGAP has been received by the Authority on 10.12.2019.

Held: Authority has carefully examined the report of DGAP and finds that there has been no reduction in the rate of tax in the post-GST period - moreover, the respondent had launched the project ‘Hero Homes' in the post-GST regime and there was no demand raised by the respondent in the pre-GST regime; that the registration and approval of the project, launching of the project and receipt of payments had taken place in the post-GST regime and hence, there was no pre-GST tax rate or ITC structure which could be compared with the post-GST tax rate and ITC; therefore, the respondent had neither benefited from additional ITC nor had there been any reduction in the tax rate in the post-GST period and, therefore, it does not qualify to be a case of profiteering - Authority finds no reason to differ from the report of DGAP, hence it is concluded that the provisions of s.171 of the CGST Act, 2017 have not been contravened in this case - applicant has also stated that he is in agreement with the investigation report dated 06.12.2019 furnished by the DGAP - allegation that the respondent has not passed on the benefit of ITC in this csae is not found sustainable - application filed by applicant requesting action against respondent for alleged violation of provisions of s.171 of the CGST Act is dismissed as being not maintainable: NAA

- Application dismissed: NAA

IO No. 18/2020

Lifestyle International Pvt Ltd

GST - Anti-Profiteering -  s.171 of the CGST Act, 2017 - Applicant alleges that the respondent had not passed on the benefit of reduction in the rate of GST on purchase of ‘Maybelline FIT Me Foundation' inasmuch as the rate of GST on the said product was reduced from 28% to 18% w.e.f 15.11.2017 - DGAP in his report dated 28.03.2018 concluded that the basic price of the impugned goods was increased by the respondent as a result of which the respondent had not passed on the benefit of tax reduction and had thus contravened the provisions of s.171 of the Act; that an amount of Rs.15,861/- was established as the profiteered amount - Authority by its order dated 25.09.2018 had directed the respondent to refund an amount of Rs.41/- along with applicable interest to the applicant and the balance amount of profiteering of Rs.15,820/- was directed to be deposited in the Consumer Welfare Fund as per rule 133(3)(c) of the CGST Rules, along with interest - since the respondent had vide their submission dated 18.05.2018 admitted that the benefit on account of reduced tax rate amounting to Rs.1,98,46,438/- might not have been passed by them to certain customers who had purchased the product in the post-rate reduction period, the Authority had directed the DGAP to investigate the above admission - respondent also submitted that they had not profited in any manner; that they have filed a Writ Petition in the Delhi High Court challenging the order passed earlier - respondent in their replies inter alia submitted that they had inadvertently computed the total amount incorrectly inasmuch as it should have been Rs.1,60,80,372/- based on the methodology adopted by DGAP - DGAP in its report stated that the profiteered amount in respect of all the impacted products comes to Rs.15,37,04,697/- - Authority observes that the respondent's submissions dated 18.02.2020 and 24.02.2020 and the accompanying data/information are voluminous and require thorough scrutiny and may entail a revised mathematical computation of the amount of profiteering, notwithstanding the previous clarifications of the DGAP contained in its supplementary reports dated 02.12.2019, 08.01.2020 and 07.02.2020 - Therefore, Authority is of the view that the matter needs further investigation based on the complete data that has been submitted by the respondent only on 18/24.02.2020 - Without going into the merits of the case and without considering the contentions and submissions of the respondents, Authority finds it imperative that there is a need for revisiting the investigation and recomputation of the profiteered amount - Authority directs the DGAP to reinvestigate the present case as mentioned under rule 133(4) of the Rules, 2017 and furnish his report accordingly under rule 129(6) of the Rules within a period of three months - Order is being passed on 04.06.2020 considering the provisions of rule 133(1) and the notification 35/2020-CT: NAA

- Interim order passed: NAA

SERVICE TAX

CENTRAL EXCISE

Brahmaputra Cracker And Polymer Ltd Vs Commissioner Of CGST & CE

CX - The assessee, a PSU, filed the appeal against impugned order refusing to grant registration to the premises of assessee at Duliajan wherein, according to the assessee, certain activities related to manufacture have been undertaken - As a result, they are unable to avail CENVAT Credit on capital goods-both imported and indigenous installed and services of Erection & Commissioning received and consumed at Duliajan Plant - Their main manufacturing unit is in Lepetkata, Dibrugarh, Assam and their associated units are at Duliajan, Lakwa and Tinsukia which carry on certain activities - The first issue which falls for consideration is, whether the assessee's Duliajan plant where the gas is merely dried and compressed for supply to their manufacturing facility at Lepetkata located 48 km away should be considered as part of the same manufacturing facility and included in their registration or otherwise - It is case where the assessee has a registered manufacturing facility and a facility 48 km away where no manufacturing but only some processing takes place and the two facilities have a common pipe through which the processed gas is transported to the manufacturing facility - The assessee's argument is that since the gas is transported through the pipeline and the pipeline is connected to both the processing unit and the manufacturing facility, both should be treated as a single unit and they should be given a single registration - It is their assertion that this is covered by the CBEC's manual - In conclusion, assessee is not entitled to get their Duliajan processing plant included in their registration for Lepetkata manufacturing plant.

The second issue to be considered is, whether the assessee is entitled to CENVAT credit on capital goods and services received at their Duliajan plant even if it is not part of their registered premises - It is now settled by a five member Constitutional bench of Supreme Court in case of Dilip Kumar and Company 2018-TIOL-302-SC-CUS-CB that where the words in a statute are clear and plain and unambiguous and only one meaning can be inferred, Courts are bound to give effect to the said meaning irrespective of the consequences - This judgment of the five member Constitutional bench of Supreme Court, which prevails over any contrary decisions of the lower courts or smaller benches leaves with no option but to interpret the Act and Rules as they were framed and applicable during the period without any intendment and regardless of the consequences - For these reasons, assessee is not entitled to CENVAT credit on capital goods installed and the services used in their processing plant in Duliajan: CESTAT

- Appeal rejected: KOLKATA CESTAT

Greaves Cotton Ltd Vs Commissioner Of GST & CT

CX - Appellants were sending Crank Shaft Facings, CAM shaft forgings, Spacer Staring Pulley Castings and Filter Castings for machining and turning in terms of Rule 4(5) of the CCR, 2004 to job workers - During verification of records for the period from September 2011 to March 2012, it was found that the job workers did not return the scrap generated during the process of job work to the appellant and the duty thereon was not paid by the appellant - demand of duty issued and confirmed by lower authorities along with penalty - appeal to CESTAT.

Held: Issue stands settled by the decision of the Tribunal in the appellant's own case in the Final Orders dated 26.07.2017 and dated 18.08.2017 and where it is held that such requirement to pay duty is in the hands of the principal manufacturer exist only in erstwhile Central Excise Rule 57F(3) and there is no such provision in the subsequent CCR - following the same, impugned order is set aside and appeal is allowed: CESTAT [para 6, 7]

- Appeal allowed: CHENNAI CESTAT

CUSTOMS

2020-TIOL-1007-HC-MAD-CUS

Cus - Valuation - Petitioners are aggrieved by the impugned communication dated 19.1.2016 whereby the 1st respondent has rejected the petitioner's request for ( a) cross examination of the persons whose statements were recorded under section 108 of the Customs Act, 1962 by the officers of the 2nd respondent; and (b) the officers who recorded such statements.

Held: Statements which are recorded under section 108 of the Customs Act, 1962 is intended for setting the law in motion for officers acting under the Act to investigate and collect evidence for issuing show cause notice whether under section 28 of the Customs Act, 1962 or under section 124 of the Customs Act, 1962 or under other provisions of the Customs Act, 1962 - Such investigation may result in prosecution before the Magistrates Court in which case, persons may be arrayed as "accused" and the persons whose statements are relied upon may be shown in the list of witnesses - Confirmation of demand solely based on statements recorded under Section 108 of the Customs Act, 1962 would require cross-examination by the petitioner - At the same time, if such statements are merely intended for corroboration of independent evidence, the cross-examination need not be allowed - Therefore, it is for the 1st respondent to decide whether the statements recorded are to be solely relied for confirming the proposed demand or are relied for mere corroboration of independent evidence gathered during investigation - In the case of former, mandatorily such statements would require cross-examination and without cross-examination, confirmation of demand would be contrary to the law settled by the Supreme Court in Andaman Timber Industries - If reliance is to be placed on any statement of any person as a witness, the 1st respondent is enjoined to issue summons and produce such persons for cross examination, unless, of course, such person is a co-accomplice of the noticee or an employee of the noticee - Therefore, it is for the 1st respondent to issue summons to these two employees of CHA's for being present for cross examination if the 1st respondent is of the view that reliance has to be placed on the statement of these persons before passing an order in the said show cause proceeding, therefore, 1st respondent may inform the petitioner whether it proposes to confirm the demand solely based on the statements of the persons whose statements have been recorded under Section 108 of the Customs Act, 1962 and if that be so, produce them for cross examination by the petitioner - Further, petitioners were not arrested or detained but they were merely summoned under section 108 of the Customs Act, 1962 to record evidence and to produce documents for making enquiry under the Act - no merits in the request of the petitioner for cross examination of the officers of the 2nd respondent: High Court [para 55, 56, 58, 59, 60, 61, 62, 64, 67, 69]

Cus - Adjudication proceedings under the Customs Act, 1962 cannot solely be based on the inculpatory statements of witnesses and noticee alone - Such statements can be only used for corroborating the case which the Department proposes to establish before the quasi-judicial authorities - The department is bound to prove the case based on balance of probabilities as per well-recognised principle of law in the case of departmental adjudications - It is therefore made clear that in case primary reliance is to be placed on the statements of the 2 employees of the 2 CHA's for passing adjudication order, the 1st respondent shall issue suitable summons for cross examination by the petitioner before passing such order - No merits in the petitions, hence the same are dismissed with directions to the first respondent: High Court [para 70 to 74]

- Petitions dismissed : MADRAS HIGH COURT

2020-TIOL-1006-HC-MUM-NDPS

NDPS - Applicant is arraigned for the offences punishable under section 8(c) read with section 21(b) of the Narcotic Drugs and Psychotropic Substances Act, 1985 ('NDPS Act') for having been found in possession of and also consumed a narcotic drug [cocaine weighing about 4.5 grams] along with two co-accused - By this revision application, the applicant No.1 assails the legality, propriety and correctness of the order passed by the Special Judge on an application for discharge in NDPS Complaint whereby the Judge was persuaded to reject the application - Before the Special Judge, the applicant had sought discharge on multiple grounds including that the seizure memo prepared by the Income Tax Department does not indicate the seizure of the alleged contraband material; that the contraband material was seized by the officers who were not empowered to carry out search and seizure operation under the provisions of the NDPS Act; that there is a discrepancy in the remand report dated 12th January 2014 and 18th January 2014 regarding the accused on whose person the contraband material was actually found and that the complainant Mr. Dole, who had allegedly seized the contraband material on 10th January 2014 also carried out the investigation and thereby vitiated the prosecution.

Held: In the case at hand, there is material to indicate that the Income Tax search was underway from 7th January 2014 to 10th January 2014 and the panchanama drawn by the Income Tax Authorities evidences the said fact - At this juncture, it would be rather hazardous to draw an inference that the said income tax search was a subterfuge - The statements of the Income Tax Officers find requisite support in the statements of the applicant recorded under section 67 of the NDPS Act - The action of the officers of the Income Tax department in apprising the said matter of finding the suspicious substance during the course of Income Tax search, in the given circumstances, cannot be said to be inconceivable and unjustifiable - The response of the income tax officers in taking over and keeping the suspicious substance, in the circumstances, cannot be clothed with the character of 'seizure', in the juristic sense - On the one hand, the requisite intent to carry on search to find out contraband substance could not have been attributed to the officers of the Income Tax department - the officers also cannot be attributed with the competence and authority to draw a definitive inference, at that stage, that the substance found was indeed contraband - Bench is not persuaded to accede to the submission on behalf of the applicant that the very act of the Income Tax Officers taking over the substance from the possession of the co-accused Dharmu Rathod amounted to "seizure" - The question of the delay in communication with the authority of the respondent No.1, in the backdrop of the fact that the contraband was found on 7th January 2014 and the communication was addressed to the officers of respondent No.1 on 10th January 2014 and, thereafter, the said contraband substance was seized by the officers of the respondent No.1, may affect the credibility of the claim of the prosecution witnesses, however, that is a matter for trial - Bench is persuaded to hold that the Special Judge was within his rights in recording a finding that there was adequate material which justified a strong suspicion of accused No.1-applicant having committed the offence punishable under section 8(c) read with section 21(b) of the NDPS Act - Thus, no interference is warranted in exercise of revisional jurisdiction - revision application stands dismissed: High Court [para 27 to 30]

2020-TIOL-1005-HC-KAR-NDPS

NDPS - Petitioner seeks enlargement on bail having suffered rejection of similar prayer at the hands of the Addl. City Civil & Sessions Judge & Special Judge (NDPS).

Held: Court declines to grant bail for the following reasons inter alia , that the offences alleged against the petitioner are grave and serious that may attract the punishment of long term imprisonment and hefty fines; there is sufficient material placed on record to prima facie show involvement of the petitioner in the offences alleged; that the argument of the petitioner that the drug seized is not of commercial quantity is bit difficult to countenance in view of the evidentiary material on record; that there is force in the contention of Revenue Counsel that restoring liberty to the petitioner-accused would be prejudicial to the interest of public health in a great measure and it would also prove difficult for securing his presence either for further investigation or trial of the case; that the contention that the liberty of citizen is more important in view of constitutional guarantees needs to be rejected since individual interest of a person has to yield to the larger interest of the society and the loss of his liberty is the price a citizen pays for being a member of civil society - Petition being devoid of merits is dismissed - Judge of the Court below is requested to explore the possibility of speedy trial and disposal of the case in accordance with law and without being influenced by what is observed in the course of this judgment: High Court [para 3]

2020-TIOL-1004-HC-AHM-CUS

Cus - When the decision of the Board of Approval has been set aside and this Court has allowed the request of the petitioner for renewal of the Letter of Approval for a period of one year; there was no question of then placing the matter for consideration of the Board of Approval inasmuch as the directions issued by this Court had to be followed by the Development Commissioner, KASEZ by issuing the formal letter of renewal of the petitioners' Letter of Approval for extension of recycling of plastic waste and scrap - Therefore, the stand adopted by the opponent No.3, Development Commissioner, for not complying with the above directions issued by this Court appears to be an attempt to delay the implementation of the order and is in flagrant disregard of directions issued by this court - In the opinion of this court, the opponent No.3 Development Commissioner, KASEZ has, for totally unjustified reasons, not complied with the directions issued by this Court - However, before taking any action in respect of such blatant disregard and non-compliance of the above order of this court, an opportunity is granted to the opponent No.3 to comply with the directions issued by this court, failing which he shall expose himself to the consequence for non-compliance of the orders of this court - Accordingly, the opponent No.3, Development Commissioner, is directed to forthwith renew and issue a formal Letter of Approval, as directed by this court vide the judgment and order dated 18.04.2019 passed in the captioned petition on or before 5th February, 2020, failing which necessary action for non-compliance of the judgment and order passed by this court as well as exemplary costs will follow: High Court [para 6 to 8]

2020-TIOL-1003-HC-AHM-CT

Sales Tax - Once the impugned notices are quashed, the attachment as per such notices would no longer survive and once the attachment goes, the charge, which has been created over the property pursuant to such notices, would also not survive - it is for the writ applicant to point out this fact to the respondent No.5 and claim compensation in accordance with law - charge of the Sale Tax Department over the parcels of land pursuant to such notices would also no longer remain - Writ application is allowed: High Court [para 7, 9, 15]

- Application allowed :GUJARAT HIGH COURT

2020-TIOL-839-CESTAT-HYD

Cus - The short point to be decided is whether the claim of the appellant that the imported goods were Marine Gas Oil (MGO) can be rebutted by the department based on the test report which indicates only four parameters and states that it has the characteristics of HSD but does not deny that it is MGO when these 4 parameters are common to both - This issue is no longer res integra and in the assessee's own case, the matter was decided in their favour - It is an accepted principle that "he who asserts must prove" and the department asserts in this case that the product is HSD and not MGO but has failed to prove so - Therefore, the imported fuel deserves to be classified as MGO as claimed by the appellant and duty charged appropriately as the test report by the chemical examiner has not tested all the parameters which are required to classify the same as HSD and has also not indicated that the material is not MGO - Accordingly, the impugned orders are set aside and all the four appeals are allowed: CESTAT [para 8, 9]

- Appeals allowed: HYDERABAD CESTAT

TP - DRP is justified in enhancing ALP adjustment made by TPO: ITAT

TP - In absence of contrary being proved by Revenue and following order passed by Tribunal in identical situation in assessee's own case for previous AY, issue of MAM for determination of ALP for international transaction of purchase of equipment for financial lease from AE can be remanded back for reconsideration: ITAT

TIOL CORPLAWS

Copyright Act - Reproduction of plaintiff's software without permission is infringement of copyright in their software programs: HC

IBC - Simple admission of debt is sufficient to establish acknowledgement of debt: NCLAT